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10:26Now PlayingComprehensive cross-platform coverage of the U.S. market close on Bloomberg Television, Bloomberg Radio, and YouTube with Romaine Bostick, Katie Greifeld, Carol Massar and Tim Stenovec.
Wall Street traders sent stocks lower after a series of all-time highs spurred calls for a breather amid signs of buyer exhaustion. Bonds rose as a $58 billion Treasury sale drew solid demand.
The ebullience driven by artificial intelligence gave way to concerns about the rally being excessive after a $16 trillion surge in the S&P 500 from its April lows. Tech giants dragged down the index amid a report that Oracle Corp.’s cloud margins are lower than many estimate. Tesla Inc. sank over 4% after introducing new versions of its top-selling models priced at under $40,000.
Investor optimism has grown heated in recent months, with many investors seeming too busy chasing the upside to worry about risks like a US government shutdown and stretched valuations.
Goldman Sachs Group Inc.’s trading desk said last week bullish sentiment among clients was the highest since December. A sentiment tracker compiled by Barclays Plc has been near a level that indicates exuberance. A similar Bloomberg Intelligence measure went back to “manic” zone.
The S&P 500 closed around 6,715. Oracle slid 2.5%. Dell Technologies Inc. climbed 3.5% after hiking estimates amid strong AI demand. US 10-year yields dropped three basis points to 4.13%. The dollar rose.
Traders also parsed remarks from Federal Reserve officials, with Governor Stephen Miran saying his expectations for a limited tariff impact on inflation mean the Fed can keep easing policy. Fed Bank of Minneapolis President Neel Kashkari warned that any drastic rate cuts would risk stoking prices.
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